Correlation Between XCPCNL Business and Exmar NV

Can any of the company-specific risk be diversified away by investing in both XCPCNL Business and Exmar NV at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining XCPCNL Business and Exmar NV into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between XCPCNL Business Services and Exmar NV, you can compare the effects of market volatilities on XCPCNL Business and Exmar NV and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in XCPCNL Business with a short position of Exmar NV. Check out your portfolio center. Please also check ongoing floating volatility patterns of XCPCNL Business and Exmar NV.

Diversification Opportunities for XCPCNL Business and Exmar NV

0.0

Correlation Coefficient

XCPCNL Business  Exmar NV

Pay attention - limited upside

The 3 months correlation between XCPCNL and Exmar is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding XCPCNL Business Services and Exmar NV in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Exmar NV and XCPCNL Business is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on XCPCNL Business Services are associated (or correlated) with Exmar NV. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Exmar NV has no effect on the direction of XCPCNL Business i.e., XCPCNL Business and Exmar NV go up and down completely randomly.

Pair Corralation between XCPCNL Business and Exmar NV

If you would invest  765.00  in Exmar NV on October 11, 2024 and sell it today you would earn a total of  421.00  from holding Exmar NV or generate 55.03% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

XCPCNL Business Services  vs.  Exmar NV

XCPCNL Business Services

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days XCPCNL Business Services has generated negative risk-adjusted returns adding no value to investors with long positions. Despite quite persistent basic indicators, XCPCNL Business is not utilizing all of its potentials. The current stock price mess, may contribute to short-term losses for the institutional investors.

Exmar NV

Risk-Adjusted Performance

10 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Exmar NV are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. Despite nearly conflicting basic indicators, Exmar NV reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with XCPCNL Business and Exmar NV

The main advantage of trading using opposite XCPCNL Business and Exmar NV positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if XCPCNL Business position performs unexpectedly, Exmar NV can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Exmar NV will offset losses from the drop in Exmar NV's long position.

The idea behind XCPCNL Business Services and Exmar NV pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Price Transformation module to use Price Transformation models to analyze the depth of different equity instruments across global markets.